 "Vandana Gombar: The energy miracle is here")
We need an energy miracle. A cheap, clean source of energy would change everything," said Bill Gates, the founder of Microsoft and the world's richest man, in his annual letter. Isn't a veritable energy miracle already playing out in the world of renewable energy, where solar and wind costs are a fraction of what they were just a few years ago, and many tens of thousands of megawatts are being installed worldwide every year?
The numbers are astounding: Over 62,000 megawatts of wind power was installed in 2015, with China alone installing 26,000 megawatts. The global figure includes a record 4,100 megawatts of offshore wind power, which came online in 2015. The fact that developers are able to plop giant wind turbines in the sea and feed the energy generated into the grid on land - and be able to secure the billions of dollars of financing required to do that - could itself be termed a miracle.
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Earlier this month, Dong Energy announced its intention to proceed with the world's largest offshore wind farm - the 1,200-megawatt Hornsea Project One, off the UK coast. It will involve installation of 174 large 7-megawatt turbines, each of which will be 190 metres high.
In solar power, about 56,000 megawatts of capacity was commissioned worldwide in 2015, three times what was installed in 2010, with as much as 68,000 megawatts expected to be installed this year. The selection of project developers is via tariff-based competitive auctions in many markets, nudging solar bids lower and closer to the tariff of fossil fuel plants. And, global module prices are still falling. In India, auctions have resulted in solar power tariffs sliding to a little over Rs 4 per unit currently. The tariffs were over four times higher in 2010.
Certainly a massive kink in the cost curve of these technologies would be a boon to the world, but they are progressing on their own momentum. What is awaited more keenly is a breakthrough in storage.
Storing renewable power is still an expensive proposition. Existing renewable energy plants are backed up by fossil fuel plants, to be used when there is no sun and no wind, and the latter emit greenhouse gases, lamented Gates.
There are, however, encouraging developments in residential storage (think Tesla Powerwall home battery), electric vehicle batteries as well as large grid-scale storage. South Korea, for instance, is installing a large 200-megawatt storage facility (lithium-ion). Nissan Motor is piloting a "vehicle-to-grid" technology for its Leaf car in Europe, which would allow electric vehicles to become part of power demand management.
Bloomberg New Energy Finance expects 750 megawatts of storage to be commissioned in 2016, almost double of the 378 megawatts that came online last year, with the leading markets besides Korea being Japan, Germany, Australia and the US.
The energy world could do with some breakthrough in clean coal technologies, so that emissions can be captured and stored. Perhaps, cleaner coal would become more of a priority if there was a price on carbon emissions. Gates highlighted the 36 billion tonnes of carbon dioxide emitted in 2015 to produce energy. Making clean coal less of an oxymoron would be a worthy target, as would providing energy access to the 1.3 billion people lacking it. How about generating power from sea waves or tides cost-competitively? Now imagine that!
The author is editor, Global Policy, for Bloomberg New Energy Finance; vgombar@bloomberg.net
Disclaimer: These are personal views of the writer. They do not necessarily reflect the opinion of www.business-standard.com or the Business Standard newspaper
